POWER SHIFT
If you drop by at the Planning Commission and ask for a status report on reform
in the power sector, you are likely to be given the Commission's annual report
on the working of the state electricity boards. It makes for depressing reading.
Over the past five years, the situation has got worse indeed, dramatically
worse) on virtually every parameter. Revenue in relation to cost has dropped
from 77 per cent to less than 70 per cent; the commercial losses have more than
quadrupled in these five years; subsidy levels have nearly doubled; and the
revenue gap per unit of electricity is so great that the average tariff will
have to be raised now by nearly 50 per cent, if the electricity sector is to
stop bleeding (any bets on that happening?). It's no surprise then that fresh
generation capacity over the past five years has been barely half of the target.
There are just two positive developments: the extent of power shortages has
reduced(thank the slower growth of the economy), and transmission and
distribution losses (most of it disguised theft) have begun to come down. Over
all, though, it looks and reads like a disaster story, and is a sharp riposte to
every hopeful individual who thinks India is reforming the way its economy is
managed.
(Courtesy Business Standard February 23, 2002)
